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The demands from all quarters to do something—do anything—about inflation show the deep American concern about this malignant problem. President Carter's attempts to slip the blame off onto Congress for failing to adopt his energy program fast enough or onto OPEC for raising prices are not being accepted. Only 2.2% of last year's 13.3% inflation was caused by OPEC price increases. West Germany has faced the same OPEC problems, and imports more of its oil than does the U.S. Yet 1979 inflation in that country was 5.5%. Says former Federal Reserve Chairman Arthur Burns: "The American people are now refusing to believe the demagogic cry that OPEC and the oil companies are to blame. The people are asking for leadership, but unfortunately, they are not getting any. We need more pain and more leadership."
Carter's herculean task in drafting and then selling another anti-inflation program is to propose measures sufficiently tight that they will break the inflationary psychology. He must prove to the U.S. public that sharply rising prices have not become a permanent part of the American way of life. If the President fails, the consequences would be serious, both politically and economically. Says former Carter Economic Adviser Nordhaus: "If this keeps up, we're going to be living in a world of 10% or 11% inflation indefinitely." In fact, if present trends continue, inflation at those levels could look like the good old days.